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gavmur [86]
3 years ago
7

Why is compounding interest monthly better than yearly ?

Business
1 answer:
dalvyx [7]3 years ago
6 0

Answer:

More interest payments on yearly computing.

Explanation:

It is generally said that if you can get monthly annual payments compared to yearly payments take it without a thought. This statement explains a lot; normally month payments are not available, but in some case they are. In annual payments, 12 months are compounded that is why it is higher rate compared to monthly. So, monthly payments are preferred

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Inferior good

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So, in this case, the person bought 10 frozen pizzas per month, but when the person start earning, then the person would not buy the frozen pizzas. The frozen pizza will be inferior good for the person as the income of the person will rise.

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